The real estate industry has experienced an amazing boom cycle during the past 11 years. Most of today’s agents have experienced only a raging market in the midst of incredible growth.
In 2005, according to recently published survey by NAR, 24% of all Realtors® have been in business one year or less and fewer than one third were in business last time the market took a dip.
Since the housing market has been a bit bumpy, some real estate agents have become alarmed. Newer agents, in particular, hesitate to spend any money to build their business. Even some “old hands” have cut or eliminated their marketing and advertising budgets and are running their offices with a “bare bones” approach.
Normally, I’m all for simplification. Usually, I would agree that if you aren’t making money, you should be wary of spending it. But in the current housing climate, I’d like to offer a few thoughts.
Seven Things a Real Estate Professional Should Consider In Today’s Market
- The market was due an adjustment, it has been over-inflated and the “creative financing” techniques of the recent past are now catching up with those who used them. It’s an old lesson: “There is no such thing as a free lunch.” When these adjustments arrive, we all take our lumps.
- Because the market was booming, individuals swarmed to the industry to make their fortunes and were rewarded with sales that didn’t require much effort. That party is over. If you are new to the industry and you don’t know your area, if you haven’t niched your services, or if you don’t understand your target market intimately — you need to get busy immediately if you ever plan to catch up. Otherwise, you won’t make it through the second quarter of 2007.
- For those who have the experience, or are willing to get it, the competition will be thinning out in real estate over the next few months. People who wanted to “make it big” in real estate will discover it’s not as easy as they thought it was going to be. Many will find other career pursuits.
- If you are a worker-bee and you were in this industry before the party started, your business is going to improve. While others are running scared, you will be standing tall and confident. The strong foundation of your years of experience and professionalism will attract new buyers and sellers. Your history of service will ensure return clients because word-of-mouth referrals will be on your side.
- If you are cutting back your ad budget — reconsider! While those who were taking out full page ads cut back to 1/4 page, consider boosting yours from your standard 1/4 page ad to a half-page — or even a full page. You should negotiate prices with the newspapers and other ad vendors, since they are probably feeling the hit from loss of sales. They may be willing to lower their prices in exchange for longer term contracts. You could get more exposure with a 1/2 page ad now than your competition had with a full page ad before — because yours may be the only one. Marketing is more important to long-term success than advertising, but if you do advertise — now is the best time to get the most “bang for your buck” in the print ads. Now is also the time to review all advertising outlay and eliminate anything that’s not capturing clients.
- If you feel that you can’t do marketing right now because short-range survival tactics are more important, think again. Most of your marketing plan can be done — with little money — simply by investing more of your personal time. While the market is slow, you probably have more time and less money. How convenient! Now is EXACTLY the time to do your long-range planning, develop your marketing approach for 2007 and begin immediate implementation.
- Realize that the projection of a market slump was, to a great degree, a self-fulfilling prophesy. The impact was amplified by the financing fiascos and the timing. It’s winter, folks. The market ALWAYS dies down this time of the year. I don’t believe the market is going to bounce back quickly, but I don’t follow those who forecast a catastrophic long-term decline. It will even out, so quit fretting and start planning for spring!
Remember that being an “old dog” doesn’t mean you avoid progress. Emerging technology, and the spin-off marketing venues it brings, will attract new markets and will reach old markets in new ways. Being an old dog means you do what works. Test and then incorporate new technologies to improve your business, your service and your reach. Old dogs stay busy, stay modern and stay viable.
We are looking 2007 square in the eye, forehead against forehead and pupil to pupil. Now is not the time to blink. Now is the time to make your plan, provide the best service to your clients and rest assured, as a career agent or broker, you will be here long after the more skittish souls have found new rainbows to chase.